NTEU and CBP settled a dozen pending national grievances filed on behalf of CBP Officers (CBPOs) and Agricultural Specialists (CBPASes) involving shift, scheduling and overtime issues. Under the agreement, eligible employees are entitled to a cash distribution and/or compensatory time.

CBP paid a sum of money into a settlement fund. A settlement administrator has been retained to calculate and make payments to individuals covered by the settlement agreement using a formula based on years of service. This was an extremely complex settlement following many years of litigation and months of challenging negotiations. Because of legal limitations on the funds CBP can use for this purpose and how those monies can be spent, the terms and the payout formula are unusually complicated.

1-2. Which grievances are covered?

The settlement covers a dozen pending national grievances filed on behalf of CBPOs and CBPASes concerning claimed violations of: (1) the scheduling requirements of 5 U.S.C. Section 6101 and Article 34, Section 5 of the contract; (2) the bid and rotations provisions of Article 13; (3) implementation of the Revised National Inspection Assignment Policy (RNIAP); and, (4) COPRA and/or the Fair Labor Standards Act (FLSA) for unpaid work. The settlement also covers local grievances making the same claims for the same time period.

1-3. Which employees are entitled to cash distributions under the settlement?

The settlement covers current and former bargaining unit GS-1895 CBPOs, including CBPOEs and canine officers, and GS-401 CBPASes who served in one of those positions between October 1, 2010 and September 30, 2015. It also includes retirees who were employed in one of these bargaining unit positions at some point in FY 11 – FY 15 (10/1/10 – 9/30/15).

1-4. Why must one have been a bargaining unit CBPO or CBPAS at some point between 10/1/10 and 9/30/15 to be eligible to receive a payment under the settlement?

Only individuals who occupied a bargaining unit CBPO or CBPAS position between 10/1/10 and 9/30/15 are eligible to receive a payment under the settlement because of legal limitations on the use of CBP’s appropriated funds.

1-5. What about employees who have retired?

Retired employees are eligible to receive payments from the settlement fund provided they occupied a bargaining unit CBPO or CBPAS position at some time between 10/1/10 and 9/30/15.

1-6. I will be retiring this calendar year. Am I eligible for a payment under the settlement?

If you held a CBPO or CBPAS position between 10/1/10 and 9/30/15, you are eligible to receive payment from the settlement fund.

1-7. I was a bargaining unit member during the 10/1/10 – 9/30/15 time period but retired. Do I receive a payment at the same time as current eligible employees?

Yes. Payments to all individuals covered by the settlement were distributed at around the same time.

1-8. Are employees who were detailed to supervisory or other non-bargaining unit positions included?

Individuals only receive length of service credit under the distribution formula for years served in a bargaining unit position. See #9 for details about the distribution formula.

1-9. How were cash distributions determined?

Individual amounts were determined using a share-based formula, with the number of individual shares based on years of service from FY2003 to FY2015 (between 10/1/02 and 9/30/15). Greater weight was given to service from 2003 to 2011, when most of the violations covered by the settled grievances occurred. Specifically, individuals were assigned 3 points for each year of service in a covered BU position between FY2003 and FY2011 and 1 point for each year of service in a covered BU position between FY2012 and FY2015.

To qualify as occupying a covered BU position during a particular year, for purposes of assigning points, the individual must have occupied the covered BU position for at least six months (180 days) of that year.

The one exception to this rule is that any individual who occupied a covered bargaining-unit position for at least one day in FY2003 received points for that year under the distribution formula. When NTEU identified a number of individuals who were not properly credited for their time in a covered position in FY2003, NTEU asked CBP for an explanation. According to CBP, it was impossible to accurately track employees’ time in a covered bargaining-unit position prior to March 2003, when legacy organizations merged to form DHS. To ensure that individuals who did work for six months or more in FY2003 were not improperly denied credit for FY2003 because of CBP’s faulty data, anyone who occupied a covered bargaining-unit position for at least one day in FY2003 was a compromise solution.

Example: An individual who occupied a covered BU position for at least one day in FY2003 and at least six months (180 days) in each year between FY2004 and FY2013 would be assigned 27 points in the distribution of 2011 funds because, as of 2011, that employee had nine years of service that fell between 2003 and 2011. Following the same approach for 2012 and 2013 funds, the individual would be assigned 28 points in the distribution of 2012 funds and 29 points in the distribution of 2013 funds.

The individual’s share of the funds in each fiscal year 2011-2015 is equal to his or her points divided by the total points for all individuals entitled to a share of the fiscal year’s funds. Thus, for the individual who occupied a covered BU position between 2003 and 2013, his or her share of the 2011 funds would be equal to 27 divided by the total number of points for all individuals entitled to the FY 2011 funds. Similarly, that individual’s share of the 2012 funds would equal 28 divided by the total number of points for all individuals entitled to the 2012 funds, and his or her share of the 2013 funds would equal 29 divided by the total number of points for all individuals entitled to the 2013 funds.

There are two limitations on payments: the annual overtime cap of $35K which was in effect during FY2011 through FY2015 (or $45K if the individual received a waiver) and payments already made pursuant to covered national or local grievances. If an individual could not receive the full amount of the payment due them in a particular FY due to the overtime cap, the settlement administrator determined whether their payment in other fiscal years can be enhanced, while remaining under the cap, to make up the difference.

1-10. Did the fact that I reached the annual OT cap in one or more of the fiscal years from FY 11 – FY 15 affect my payment under the settlement?

Possibly. The settlement agreement provides that “payments issued to an individual for a particular fiscal year under the distribution formula cannot cause that individual to exceed that fiscal year’s limitation on overtime pay.” Those who do not receive their full payment because of cap limitations are entitled to additional comp time.

1-11. When were employees who did not receive their full payment because of OT cap limitations notified of their entitlement to additional comp time?

The approximately 750 individuals who were entitled to compensatory time in the first distribution received notice of their compensatory time entitlement in the letter accompanying their first check. The approximately 360 employees who were entitled to compensatory time in the second distribution received notice of their compensatory time entitlement in the letter accompanying their second check.

Compensatory time is shown on these individuals’ statements of earnings and leave. Because CBP’s systems do not recognize compensatory time for COPRA-covered individuals, however, the compensatory time is coded as “travel compensatory time” or “TCT.”

1-12. How much additional comp time was granted to employees who did not receive their full payment because of OT cap limitations?

In general, employees who do not receive their full payment because of OT cap limitations are entitled to comp time in the amount of their individual payment that was precluded by the cap, divided by twice their average hourly pay in the years when their payment was limited by the cap. Employees who, before receiving an award under this settlement, came within $500 of the cap in fewer than 4 of the 5 years from FY 11-15 can receive up to an additional 24 hours of comp time. Employees who, before receiving an award under this settlement, came within $500 of the cap in 4 of the 5 years can receive up to 40 additional hours. And employees who, before receiving an award under this settlement, came within $500 of the cap in all 5 years received up to 84 additional hours.

Example: A covered individual received $5,000 in back overtime pay under the settlement distribution formula. That individual earned $34,500 in each year between FY11 and FY15, leaving aggregate cap room in the amount of $2,500. Because the individual came within $500 of the cap in all 5 years and could not receive the full payment of $5,000, the individual would receive up to an additional 84 hours of comp time.

To calculate the amount of additional comp time, the $2,500 difference between the amount due under the formula ($5,000) and amount payable under the cap ($2,500) would be divided by twice the average of the employee’s hourly pay rates in FY11 through FY15 to arrive at the additional comp time due the employee. Assume the employee’s average hourly rate in FY11 through FY15 is $40. $2,500 divided by $80 (twice this hourly rate) is 31.25. The employee would receive 31.25 comp hours in addition to the 16 hours granted to all covered employees in pay period 20 of 2016.

1-13. When must those who receive additional comp time due to OT cap limitations use the additional comp time?

The settlement agreement requires that this comp time be used before sick and annual leave until the comp time is exhausted. All leave requests will be charged against compensatory time off until that balance is used up.

Comp time awarded in the first distribution was posted to individuals’ leave records and available for use by pay period 9 in 2018, except certain individuals who were projected to exceed the 240-hour limitation on annual leave for 2018 could defer their comp time award until the first full pay period of 2019.

Comp time awarded in the second distribution will be posted to the employees' leave records and available for use in the first full pay period in January 2019.

Individuals must use their comp time by the end of the 26th pay period after the pay period when it was posted to their leave records. Individuals who are not able to use all or a portion of their comp time within 26 pay periods because management would not approve its use or because they separated from CBP will be paid for such comp time. Under the regulations governing comp time, the dollar value of comp time when it is liquidated is the amount of overtime pay the employee otherwise would have received for the hours of the pay period during which comp time was earned by performing overtime work. Comp time awarded under the Global Settlement, however, cannot be traced to a pay period during which it was earned by performing overtime work. Thus, CBP has agreed to pay individuals for each unused hour of comp time at the COPRA double-time rate, using, for the sake of administrative ease, individuals’ hourly rate of pay in September 2016.

1-14. Who performed the distribution calculations and distribute the funds?

A firm, BrownGreer (BG) in Richmond, Virginia, was retained to serve as the settlement administrator (SA) to perform these functions. BG specializes in this type of work. The SA has been communicating with individuals covered by the settlement and is resolving any disputes about payment amounts.

1-15. Is the settlement administrator being paid out of the settlement funds?

No, CBP is paying the costs of the services provided by BG separately.

1-16. How much of the settlement fund was paid to employees? What money came out of the settlement fund?

Almost all of the $184 millionwas paid to employees. The only money that came out of the settlement fund was for CBP’s employer contributions toward FICA (Medicare and Social Security) taxes.

1-17. What money came out of the employee’s cash distribution?

By law, income taxes must be withheld from individuals’ payments. In addition, Social Security and Medicare taxes under the Federal Insurance Contributions Act (FICA) must be withheld from the payments of most individuals covered by the settlement. For approximately 440 individuals enrolled in variations of the Civil Service Retirement System, only Medicare taxes must be withheld. CBP initially gave incorrect tax-rate information for these 440 individuals, and as a result, Social Security taxes were erroneously withheld from their first settlement payments. These individuals were mailed a refund check. Appeals regarding the erroneous withholding of the Social Security taxes were effectively granted. Social Security taxes were not withheld from these individuals' payments in the second distribution of settlement funds, which occurred November 2018.

W-2s containing payment amounts and withholdings will be issued to each individual who receives a payment.

1-18. The Settlement Administrator withheld taxes for a different state than where I live. Can the Settlement Administrator arrange for me to receive a refund of those taxes?

No. The payment was not issued by CBP and was not made to you in your capacity as a CBP employee. Instead, it was made to you as a covered individual under the terms of the Global Settlement Agreement and Addendum by the CBP Global Settlement Trust, a designated Qualified Settlement Fund Trust, implemented by BrownGreer as the Settlement Administrator. The Agreement and Addendum establish payment mechanisms for covered individuals different than if the individual was being paid in the capacity as a CBP employee by CBP as an employer. As examples: (a) under the terms of the Agreement and Addendum, retirement contribution withholdings and Thrift Savings Plan (“TSP”) withholdings do not apply to and were not withheld from the settlement payments; (b) the Agreement and Addendum stipulate that federal income tax withholdings for settlement payments are made at the flat supplemental wage rate, rather than based on individualized withholding allowance rates; and (c) the Agreement and Addendum established that covered individuals’ addresses, as provided to the Settlement Administrator by CBP as of March 2017, are to be used as the confirmed CBP addresses for purposes of State income tax and local income tax withholdings.

A second distribution of payments occurred in November 2018. State and local tax withholdings for these payments were based on your most up-to-date address on file with the Settlement Administrator as of August 31, 2018.

You may consult with your tax advisor as to whether you may seek a refund from the state for which taxes were withheld from your payment. Neither the Settlement Administrator nor NTEU can you give you tax advice. Whether you owe these amounts is between you and the state taxing authority.

1-19. I moved to a different state after the first distribution of checks in May 2018. Which state taxes were withheld from my payment in the second distribution?

State and local taxes withheld from individuals’ payments in the second distribution were based on their addresses on file with the Settlement Administrator as of August 31, 2018. Although most individuals’ check stubs indicated both the amount of state taxes and the particular state for which taxes were withheld, the check stubs for the approximately 1,000 individuals whose state changed between the first and second distributions indicated the amount of state taxes, but not the particular state. All covered individuals, however, will receive a W-2 in January 2019 with complete federal, state, and local tax information applicable to their settlement payments. Individuals may also call the Settlement Administrator’s call center to confirm which state’s taxes were withheld from their payments.

1-20. Were retirement and TSP contributions made with my settlement payment?

Originally, the settlement provided that CBP’s required employer retirement and TSP contributions (totaling $15 million) were to be paid from the settlement fund, and employee retirement and TSP contributions would be deducted from individuals’ settlement payments. But CBP was unable to figure out how to transfer the retirement and TSP contributions from the settlement fund administered by Settlement Administrator to the agencies that administer those programs. To address this issue, in March 2018, the parties agreed that the $15 million that was to be deposited into individuals’ retirement and TSP accounts would instead go back into the general fund for distribution to covered employees. With this $15 million available for distribution, individuals received larger settlement payments. This solution also avoided additional indefinite delay caused by CBP’s inability to determine how to handle the retirement and TSP contributions. This extra $15 million will be distributed with the second round of checks.

1-21. Will the back pay I received affect my high 3 year average for purposes of calculating my retirement annuity?

No. Originally, the settlement provided that back OT pay received under the settlement would be credited to a covered individual’s OT earnings for each fiscal year from FY 11 through FY 15 that the individual occupied a covered position, and any amount up to $17,500 would count towards the individual’s basic pay for retirement purposes. But because CBP could not figure out how to make contributions from the settlement fund to the government’s retirement fund, in March 2018, the parties agreed that settlement payments would not constitute basic pay for retirement purposes. One consequence of this March 2018 agreement is that settlement payments will not affect your high 3 year average for purposes of calculating your retirement annuity. Accordingly, no employee retirement contributions were withheld from your payments. Another consequence is that the money from the settlement fund previously set aside for CBP’s employer retirement contributions became free for distribution. This money wasdistributed in the second round of checks.

1-22. When and how were cash distributions be paid?

The first distribution of settlement checks occurred in the first two weeks of May 2018. Funds remaining in the settlement trust after the first distribution were distributed in a second round of checks, which were mailed in waves over a two-week period in early to middle November 2018. The deadline to cash your second check before it becomes stale dated is January 11, 2019.

Second Distribution checks will be mailed to your most up-to-date address on file with the Settlement Administrator as of October 15, 2018. You can still submit an address update after that date, in which case but you must do so as soon as possible. If you update your address with the Settlement Administrator as soon as possible, the Settlement Administrator may be able to re-mail your check to your updated address. Note, though, that for your address update to have impacted the state or local taxes withheld from your payment, the address update must have been received on or before August 31, 2018.

1-23. What was done to fix the errors in the original data set?

CBP first provided data to the settlement administrator in March 2017. After the settlement administrator calculated payments, and as checks were scheduled to be mailed in early August 2017, NTEU discovered that CBP’s data contained several critical systemic errors. One of the errors involved CBP improperly crediting time as Border Patrol agents and Import Specialists for approximately 1,100 individuals. In a second error, CBP failed to credit time in a bargaining unit status from 2008 to 2010 for approximately 600 individuals who were improperly excluded during that time. CBP provided new data in October 2017 in which it purportedly fixed these errors.

CBP’s first data set also included deceased individuals. To fix this problem, NTEU, CBP and the settlement administrator identified deceased individuals and removed them from the list of payees. NTEU leaders had an opportunity to verify the accuracy of these identifications.

After the settlement administrator recalculated payment amounts based on the revised data provided in October 2017, and as checks were scheduled to be mailed in early 2018, NTEU discovered still more systemic errors in CBP’s data.

First, CBP provided inaccurate information regarding time in a covered bargaining unit position in 2003. According to CBP, this error stemmed from the fact that the format of its records from 2003, when components of various other agencies merged to form the Department of Homeland Security, did not align with CBP’s more recent data. After further investigation, CBP concluded that it is impossible to accurately track employees’ time in a covered bargaining-unit position prior to March 2003 because of the complexities of merging pre-DHS systems. Thus, NTEU was forced to devise a compromise solution. Any individual who occupied a covered bargaining-unit position for at least one day in FY2003 will now receive points for that year under the distribution formula. That will probably result in a small number of individuals receiving credit for FY2003 who did not, as otherwise required by the formula, work six months of that year in a covered position. But NTEU’s priority is to ensure that individuals who did work for six months or more in FY2003 – the vast majority of those covered by this compromise solution – were not improperly denied credit for FY2003 because of CBP’s faulty data.

Second, CBP credited some Agriculture Specialists with fewer days in the bargaining unit in 2007 than they actually worked. According to CBP, this error stemmed from the fact that its process for counting days in the bargaining unit used “0430” as the bargaining unit code for Agriculture Specialists, but some records displayed the code as “430.” As a result, CBP’s process, which used the four-digit code, did not pick up records that used the three-digit code. To fix this error, CBP has revised its process to capture records that use both the four-digit code and the three-digit code.

Third, CBP’s data captured time in bargaining unit positions that are not covered by the settlement. In its newly-provided data, CBP has only counted time in covered bargaining-unit positions—in general, CBP Officers and CBP Agriculture Specialists.

1-24. If I received a payment under a national or local grievance that is included in the settlement, am I still entitled to a payment from the settlement fund?

Payments received pursuant to a grievance included in the settlement were subtracted from payments made from the settlement fund. The amount of a previous settlement payment you received, if any, was set forth on the statement issued with the first check. You may also check with your local chapter if you believe you may have received such a payment.

1-25. What can I do if I disagree with my payment amount?

Individuals who disagreed with their payment amounts were permitted to contest the correctness of certain factors that went into determining their award amount: (1) whether they occupied a covered BU position at any time in FY11, 12, 13, 14, or 15; (2) whether they occupied a covered BU position for at least one day in FY03 or at least six months (180 days) in any fiscal year between FY04 and FY15; (3) whether they exceeded their overtime cap in FY11, 12, 13, 14, 15; (4) whether they already received a payment pursuant to covered national or local grievances.

Appeals were due by June 25, 2018, and decisions on timely-submitted appeals were issued in waves throughout September 2018. Individuals whose appeals were granted received their full payment—including any amount that they would have received but for the error identified in the appeal—in the fall of 2018, when the money remaining in the settlement trust was distributed in a second round of checks.

The Settlement provided for only one opportunity to appeal because it was anticipated that any remaining errors in the employment data used to calculate individual payments would be corrected in the appeals process following the first round of payments. No appeals to contest payments received in the second distribution will be permitted.

1-26. How were appeals resolved?

The settlement administrator reviewed claims by covered individuals who asserted that they were wrongly denied payment or that the amount initially paid was incorrect. Although CBP was involved in investigating claims by covered individuals who contested the correctness of the data that CBP provided, the settlement administrator made the ultimate decision.

The settlement administrator granted or denied appeals based on a preponderance of the evidence. In other words, the settlement administrator determined, based on the information provided by the appellant and by CBP, whether the appellant’s claim was, more likely than not, true.

1-27. If I filed an appeal, what comes next?

Appeal decisions were issued in waves throughout September 2018. For individuals whose appeals were denied, the decision notice provided an explanation for the denial. For individuals whose appeals were granted, the decision notice did not itself indicate the additional amount of money due as a result of the appeal; because of the share-based formula, this amount could not be determined until all appeals were resolved and calculations were rerun. But individuals whose appeals were granted received what they would have received, but for the error identified in their appeal, in their second-distribution check.

As explained below, if you were not able to receive your full settlement payment because of the overtime cap in any fiscal year between FY 11 and FY 15, you may been entitled to additional compensatory time under the formula set forth in the Settlement agreement. If you filed an appeal alleging that you did not earn as much overtime in a fiscal year as CBP says you did, or that the wrong overtime cap was applied, and if your appeal was granted, you received additional money, and your comp time award was reduced.

1-28. Can the settlement administrator reissue my check in a different name?

The award check can only be issued to an individual who is covered under the settlement.

1-29. If I receive a check for a deceased employee, can the settlement administrator reissue it in my name?

No. Deceased employees are not covered under the settlement.

1-30. If I did not receive my check, can the settlement administrator reissue it?

In the first distribution, the Settlement Administrator was able to re-issue and re-mail checks to individuals whose checks were mailed to the wrong address if those individuals contacted the Settlement Administrator by August 1, 2018. The Settlement Administrator was able to include the amount of an individual’s first-distribution check in his or her second-distribution check if the individual contacted the Settlement Administrator after August 1, 2018 but before August 31, 2018.

1-31. What if I received my check in the mail but I did not cash it before it expired?

Individuals who received their check in the mail but did not cash it will receive the amount of their first-distribution check in their second-distribution check if they attempted to cash their check or contacted the Settlement Administrator before August 31, 2018.

1-32. Is interest accruing on the settlement funds? What will happen to that interest?

The monies set aside for the CBP Global Settlement have been accumulating interest in a trust account. This interest, in addition to the principal, will be distributed to employees pro rata with their share of the settlement fund in the second distribution.